Dependable Erection

Wednesday, February 25, 2009

Another one bites the dust

Ritz Camera, the largest dedicated camera retailer in the US has filed for Chapter 11 bankruptcy protection. The company, which owns over 800 stores across the country, under a series of names, including Wolf Camera, has proposed a restructuring plan that will aim to see the chain continue in some form. As part of this, the company has applied to the bankruptcy court for permission to continue to honor its customer loyalty and rebate schemes.

In an affidavit to the court Marc Weinsweig, appointed as Chief Restructuring Officer and COO as part of the Chapter 11 process, describes his actions as being aimed at 'maintaining the day-to-day operations of the company's business with minimal disruption' in what he characterizes as 'daunting economic times.'

Court papers suggest that Ritz Cameras owes over $40 million to its two largest creditors: Nikon's US subsidiary Nikon Inc. and Canon USA, with a further $8.4 million owed to Fujifilm USA, a subsidiary of which owns around a third of the company. To put the $26.6 million owed to Nikon Inc. into perspective, it would represent somewhere in the region of 20% of Nikon Inc's expected annual operating income.

Chapter 11 of the US Bankruptcy Code provides companies with protection from their creditors while they attempt to restructure. However, US retailer Circuit City, which filed for bankruptcy protection in November 2008 announced the closure of all its stores and the liquidation of its assets on January 16th.

Yeah, i know. Buying a camera from Ritz or Wolf was not the most enjoyable experience. But with the demise of big box chains, specialty chains, and even locally owned specialty stores, where the hell are you going to go to, you know, buy shit any more? I'm not interested in buying everything i want to have from Sometimes i want to see it, hear it, and hold it before i buy it.

And given that we're a service economy, losing all these service jobs doesn't bode well for the short term, does it?

UPDATE: another thought which occurs to me is that, even though big retail chains pull a lot of money out of the local economy, they do at least collect local sales taxes. If even the big boxes (Circuit City) and the specialty retailers (Tweeter, Wolf Camera) leave, and people are buying what few items they do spend their money on online, how are those taxes collected? I know you're supposed to calculate that on your state tax return every year, but i wonder how many people actually do that? How much additional revenue does the city and county stand to lose if even the national retail chains don't survive the ongoing economic disaster?



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